Financial Knowledge and Decision-Making Skills - Building Blocks of Financial Capability

Research from the Consumer Financial Protection Bureau (CFPB) shows that the knowledge, attitudes, skills, and habits adults need to make informed financial decisions and achieve financial peace of mind stem from three interconnected building blocks developed in youth. These building blocks form a framework for youth financial literacy education. Children and youth need all three of the interconnected building blocks to achieve financial capability.

This video examines the building block called financial knowledge and decision-making skills. Financial knowledge and decision-making skills help people make informed financial decisions through problem-solving, critical thinking, and an understanding of key financial facts and concepts. Strong financial knowledge and decision-making skills help people weigh options and make informed choices for their financial situations, such as deciding how and when to save and spend, comparing costs before a big purchase, and planning for retirement or other long-term savings. The CFPB has classroom activities and other tools, resources, and materials to help teachers nurture their students’ development of the financial knowledge and decision-making skills.

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